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Regional Commentary and Property Market Statistics - October 2020

Market Statistics

Property Brokers 13 Nov 2020

REINZ stats_October2020-1The number of residential properties sold in October across New Zealand increased by 25.0% from the same time last year (from 7,063 to 8,830) – the highest number of properties sold in 53 months (May 2016) and the highest October sales count since October 2006 (14 years), according to the latest data from the Real Estate institute of New Zealand (REINZ).

For New Zealand excluding Auckland, the number of properties sold increased by 14.2% when compared to the same time last year (from 4,982 to 5,690) – the highest number of properties sold since March 2017 (43 months) and the highest October sales volumes since October 2006 (14 years).

Bindi Norwell, Chief Executive at REINZ says:“New Zealand’s housing market is extremely buoyant at the moment, with more than 8,800 properties sold around the country – that’s more than 283 properties sold every day in October. The last time we saw sales volumes of this magnitude was back in May 2016 when the market was very strong, and prices were rising across many parts of the country."

“Again, we’ve seen more than half (9 out of 16) of the regions across the country with annual sales volume
increases in excess of 20% in October – this is just not what anyone expected to happen and shows just how
much people’s concern around future price rises is adding to their determination to buy now before prices
potentially rise even further,” continues Norwell.

Regions with the largest increase in annual sales volumes during September were:
•Gisborne: +43.2% (from 44 to 63 – 19 more houses) – the highest for the month of October since October 2005 (15
years)
• Waikato: +30.4% (from 737 to 961 – 224 more houses) – the highest sales volumes for the region in 53 months and the highest for the month of October in 17 years
• Marlborough: +29.3% (from 82 to 106 – 24 more houses) – the highest sales volume in 24 months
• West Coast: +28.2% (from 39 to 50 – 11 more houses) – the highest for an October month in 5 years
• Taranaki: +24.5% (from 159 to 198 – 39 more houses) – the highest for an October month in 14 years
• Southland: +23.2% (from 177 to 218 – 41 more houses) – the highest for an October month in 13 years.

Regional Analysis - Auckland

“Median house prices in Auckland reached a new record in October of $1,000,000, up 16.3% from October 2019 as the percentage of $1 million plus properties sold exceeded the 50% mark for the first time. Sales volumes for the region were up 50.9% year-on-year with 3,140 properties sold in October, the highest level of sales in 67 months. As expected, as we move closer to summer and the months are getting warmer, interest from potential purchasers is high and attendance at open homes has increased with some new listings seeing up to 50 people a weekend. Multi-offers and pre-auction offers continue to be popular as demand outstrips supply despite new listings increasing 36.8% year-on-year with 4,877 new listings coming to the market in October. Investor activity is a mixed bag, with some choosing to hold or lower their levels of investments, while others are looking for properties with potential to subdivide or improve – however, overall the number of investors in the market seem to be up from the same time last year. First time buyers remain active in the market, however, securing finance continues to be a challenge as banks are being more cautious and placing more emphasis on employment status and history. Additionally, banks are taking up to twenty days to approve lending and are getting stricter on properties that have LIM issues etc.” (REINZ)

The current Days to Sell of 30 days is less than the 10-year average for October which is 33 days. There were 12 weeks of inventory in October 2020 which is 8 weeks less than the same time last year.

Regional Analysis - Northland

“Demand for properties in the Northland region has not subsided with sales volumes up 20.6% in October 2020 from the same time last year – the highest for an October month in 17 years. Median house prices increased 16.5% year-on-year to a new record of $600,000. Investors are keen to increase their portfolio but are finding themselves limited by the low stock levels available. Interest from first home buyers has continued at their increased levels from 2019, however, it seems banks are becoming more cautious and accessing finance is becoming harder for this category of purchasers. This has simultaneously resulted in an increase in cash buyers in the market compared to 12 months ago, as buyers know they need to be preapproved if they want to compete in the increasingly Common multi-offer situations. Anecdotally, we are hearing that there are plenty of appraisals being done, but new listings for the region are down -3.9% from the same time last year, largely due to potential vendors being reluctant to sell without a replacement property lined up.” (REINZ)

The current Days to Sell of 39 days is much less than the 10-year average for October which is 50 days. There were 26 weeks of inventory in October 2020 which is 10 weeks less than the same time last year.

Regional Analysis - Waikato

“The Waikato region saw another record median house price of $655,000 in October 2020, up 15.9% from the same time last year, and the sixth consecutive month of new or equal record highs. Sales volumes increased 30.4% year-on-year with 961 properties sold – the highest number of sales in 53 months, and the highest for an October month since 2003. Interest levels have held rather steady over the last few months with first home buyers finding it harder to compete with investors and other purchasers as prices increase. Banks are taking longer for approvals, particularly with first home buyers, however, there are more cash buyers in the market as people aren’t spending their money on overseas trips. Multi-offers continue to be a frequent occurrence, with potential purchasers quickly learning that they need to be unconditional or as close to it as possible to have their offer accepted. Properties are selling quickly with days to sell down to 28 days for the region, the lowest it has been in any October since records began. New listings increased 12.8% year-on-year as we would tend to expect an uplift postelection. These levels of activity are expected to continue over the next few months.” (REINZ)

The current Days to Sell of 28 days is less than the 10-year average for October which is 36 days. There were 10 weeks of inventory in October 2020 which is 6 weeks less than the same time last year.

Regional Analysis - Bay of Plenty

“Median house prices in the Bay of Plenty region increased 16.2% year-on-year in October 2020 to a new record high of $720,500 with Rotorua and Tauranga again seeing record median prices of $580,000 and $810,000 respectively. Sales volumes increased 6.1% when compared to the same time last year to 576. Demand continues to outweigh supply with new listings were down -7.3% year-on-year which has continued to put strain on stock levels. Additionally, investor activity remains strong in the region. The Bay of Plenty region is now at its lowest level of inventory since records began with 7 weeks available, down from 15 weeks at the same time last year. These levels of activity are expected to continue over the coming months.” (REINZ)

The current Days to Sell of 34 days is less than the 10-year average for October which is 43 days. There were 7 weeks of inventory in October 2020 which is eight weeks less than the same time last year.

Regional Analysis - Gisborne

“Gisborne region’s median house price increased 34.1% yearon-year in October 2020 to a new record of $570,000, a $145,000 uplift from the same time last year. Sales volumes for the region are up 43.2% when compared to October 2019. At 63 properties sold, this is the highest sales count for an October month since 2005. Open homes are very busy as limited stock on the market means competition is high for any listing. First home buyers and investors are both very active in the market, due to continued low interest rates and lack of LVRs. Auctions continue to be a popular choice with 74.6% of all sales within the region being completed by auction. New listings are up 18.8% from the same time last year, with stock selling quickly.” (REINZ)

The current Days to Sell of 31 days is less than the 10-year average for October which is 37 days. There are 22 weeks of inventory in October 2020 which is 15 weeks more than the same time last year.

Regional Analysis - Hawke's Bay

“The Hawke’s Bay region saw an increase of 10.9% in the number of properties sold (274), the highest level for an October month in 14 years (since 2006). Median house prices increased 10.3% year-on-year to $590,000 one of only two North Island regions to not hit a new record median this month. These increases are supported by the REINZ House Price Index which showed a 17.1% increase annually for the Gisborne/Hawke’s Bay region to a record high of 3,488. Anecdotally, we are hearing that vendors are wanting to secure a new property before placing theirs on the market which is continuing to place pressure on inventory. Properties are continuing to sell quickly, with days to sell down 2 days from the same time last year to 28 days, the lowest for an October month since 2003.” (REINZ)

The current Days to Sell of 28 days is less than the 10-year average for October which is 36 days. There were 8 weeks of inventory in October 2020 which is one week more than the same time last year.

Regional Analysis - Taranaki

“Taranaki saw a median house price of $480,500 in October 2020, up 23.2% from October 2019 but down from $485,000 in September and one of only two regions with a month-on-month decrease. However, sales volumes increased 24.5% year-on-year from 159 in October 2019 to 198 in October 2020, the highest sales count for an October month since 2006. Anecdotally, we are seeing more second and third time buyers moving throughout the market with less active first home buyers. The combination of low interest rates combined with strong buyer demand and a shortage of listings has created a tough market. However, with listings for the Taranaki region increasing 15.4% year-on-year and asking prices decreasing -6.7% from September 2020, we will hopefully start to see some easing of the pressure on the market and improving stock levels.” (REINZ)

The current Days to Sell of 21 days is much less than the 10-year average for October which is 36 days. There were 10 weeks of inventory in October 2020 which is five weeks less than the same time last year.

Regional Analysis - Manawatu/Whanganui

“The Manawatu/Wanganui region saw another record median house price of $470,000 in October 2020, up 17.5% from the same time last year – the fourth consecutive month of record median prices for the region. There continues to be strong interest from first home buyers which is driving a lot of the market demand with many properties selling via multi-offer. Sales volumes are up 2.3% year-on-year. Local residents are staying active in the market, looking at upgrading, upsizing or downsizing. Investors are having mixed reactions across the region with
some looking at property as an option because of low interest rates and available funds, whereas others are concerned about the new tenancy laws but are currently still active. Listings for the region are down 11.3% which continues to put pressure on inventory levels which are sitting at 6 weeks – one of the lowest levels across the country. Open homes are busy, particularly with new listings which is resulting in quick sales.”(REINZ)

The current Days to Sell of 24 days is much less than the 10-year average for October which is 35 days. There were 6 weeks of inventory in October 2020 which is two weeks less than the same time last year.

Regional Analysis - Wellington

“The Wellington region saw a new record median price of $785,000 in October 2020, up 20.8% from the same time
last year. This was bolstered by an uplift in the number of $1 million plus properties sold across the region. Sales volumes are flat from the same time last year with 750 properties sold during the month. The Wellington region saw a decrease of -9.6% in new listings in October with 684 properties coming to the market. This has left the region with one of the lowest levels of inventory across the country at just 6 weeks. Properties are selling quickly with days to sell down 3 days from the same time last year to 26 days – the lowest for an October month since 2006. The ‘fear of missing out’ is influencing these quick sales and we expect this pressure will continue in a similar manner over the coming months as demand continues to outstrip supply.” (REINZ)

The current Days to Sell of 26 days is less than the 10-year average for October of 30 days. There were 6 weeks of inventory in October 2020 which is the same as the same time last year

 

Regional Analysis - Nelson/Marlborough

“Median prices in the Nelson/Marlborough/Tasman regions increased in October 2020 when compared to the same time last year, up 10.5%, 26.8% and 12.9% respectively. Marlborough reached a new record median price of $565,000 in October 2020, up from $445,500 in October 2019. Sales count was down -1.0% for Nelson, but was up 10.7% and 29.3% for Tasman and Marlborough respectively. Marlborough saw the highest sales count in 24 months, and Tasman saw the highest sales count for an October month in 17 years. Demand has remained high for good properties with 31.4% of all sales in the $750,000+ bracket, compared to 15.8% in the $750,000+ bracket at the same time last year. Many properties are receiving multi-offers and selling above vendor expectations.” (REINZ)

The current Days to Sell of 27 days is less than the 10-year average for October which is 32 days. There were 9 weeks of inventory in October 2020 which is 4 weeks less than the same time last year.

Regional Analysis - West Coast

“The West Coast region saw a 25.6% increase in median house price compared to the same time last year, reaching $250,000 in October 2020. The region saw the highest volume of sales for an October month in 15 years, up 28.2% year-on-year to 50 properties sold. Competition for good properties is still high with the majority of purchasers early retirees looking to achieve a low-cost lifestyle. Multi-offers are becoming more of a standard approach instead of the exception and a wet spring seems not to have deterred purchasers, so activity levels are expected to stay high through the summer months.” (REINZ)

The current Days to Sell of 31 days is much less than the 10-year average for October which is 99 days. There were 30 weeks of inventory in October 2020 which is 10 weeks less than the same time last year.

Regional Analysis - Canterbury

“The Canterbury region reached a new record median house price in October 2020, up 9.7% year-on-year to $510,000 – the third month in a row of record highs. Additionally, Christchurch City and Timaru District had new record medians of $526,000 and $410,000 respectively. Sales count for the region was up 21.3% year-on-year to 1,212 properties sold – the highest volume of sales for 163 months (since March 2007). First home buyers are still very active in the market, as are investors – however, with low levels of stock, options are low. Inventory is down 8 weeks year-on-year to 10 weeks of available inventory and listings are up 9.3% from the same time last year, however a lack of new builds is further increasing the pressure on the market. Auctions continue to remain popular, with packed auction rooms seeing 20% of all properties sold under the hammer in the region in October.” (REINZ)

The current Days to Sell of 29 days is less than the 10-year average for October which is 31 days. There were 10 weeks of inventory in October 2020 which is eight weeks less than the same time last year.

Regional Analysis - Otago

“The Queenstown Lakes District saw median house prices increase 7.4% year-on-year to $1,010,000. Sales volumes for the District increased 47.4% when compared to the same time last year, from 95 in October 2019 to 140 in October 2020. Buyer enquiry is strong across the price brackets, but particularly in the $750,000+ bracket. There is a lot of interest from out of town buyers and from international Kiwi buyers looking to return home. Access to finance has continued to be a challenge for first time buyers hoping to get on to the property ladder.” (REINZ)

“Dunedin City saw median house prices increase 10.9% year-on-year from $505,000 in October 2019 to $560,000 in October 2020 and sales volumes were down -8.0% year-on-year to 183 properties sold. Open homes are busy with 15-25 parties through each, showing the demand in the area. Vendor expectations are high as a result of increased interest. First home buyers are still very active in the market. All conditional buyers are having trouble competing with unconditional buyers. Access to lending is still an issue for buyers, with banks taking 10-15 working days and asking for much more detail from borrowers.” (REINZ)

The current Days to Sell of 32 days is the same as the 10-year average for October. There were 11 weeks of inventory in October 2020 which is four weeks more than the same time last year.

Regional Analysis - Southland

“Median house prices in the Southland region increased 17.4% annually from $315,200 in October 2019 to $370,000 in October 2020. Sales volumes increased 23.2% year-onyear with 218 properties sold in October. Low interest rates and a lack of LVRs have continued to encourage all buyer groups including investors and first home buyers, meaning that open homes have remained busy. Properties in the $500,000+ bracket have increased from 11.3% of sales in October 2019 to 20.2% of sales in October 2020. The REINZ HPI for Southland reached a new record in October, up 9.0% year-on-year to 3,535, showing the ongoing increase in property value for the region.” (REINZ)

The current Days to Sell of 28 days is less than the 10-year average for October which is 30 days. There were 11 weeks of inventory in October 2020 which is one week less than the same time last year.